Business Model

Curators: Palak Dalmia, Ayush Mukherjee, Lucky Khandelwal, Riyansi Tulsyan & Soumya Goenka

Key Partnerships: 

Partnership	Stake Distribution	Investment Details	Project Overview
DLF and Green Horizon Trustee Limited (Hines)	DLF: 67%, Hines: 33% (option to increase to 49%)	Total investment: ₹1,900 crore; Hines initial contribution: ₹500 crore	Project spans 11.76 acres near DLF CyberCity, and aims to set benchmarks in commercial real estate.
DLF and Prudential International Insurance Holdings Ltd (PIIHL)	DLF: 74%, PIIHL: 26%	Initial capital: ₹1,000 crore; DLF: ₹740 crore, PIIHL: ₹260 crore	Strategic partnership to leverage DLF’s market presence and Prudential’s insurance expertise in India’s life insurance market.
DLF and GIC (Government of Singapore Investment Corporation)	DLF: 60%, GIC: 40%	Investment of approximately ₹1,990 crore for two residential projects in central Delhi	Established in 2015 to focus on residential developments, enhancing DLF’s project portfolio.

Key Suppliers:

Supplier	Products/Services	Contributions
Mercury Global FZE	Construction materials	Direct supply to sites, logistics support, quality assurance.
Edifice Ventures Ltd	Lighting products	Imports high-quality lighting for luxury projects.
Leonardo S.p.A.	Aerospace and defense technology	Supplies avionics and UAVs for military projects.
Leonardo Malaysia SDN BHD	Defense technologies	Provides avionics and radar systems, enhancing operational efficiency.

Revenue Stream: Post Covid-19, the Real Estate Industry has seen a huge surge in demand for residential properties as well as commercial spaces.

• Residential Properties: FY23 had a total booking of ₹ 15000 Cr. As of March 2023, there was ₹ 3100 Cr. and ₹ 4300 Cr. of completed and ongoing unsold inventory. 
• Commercial Segment: Rental revenue for FY23 was ₹ 4000 Cr.
• Retail Segment: Rental revenue from retail properties for FY23 was ₹ 869 Cr.

Total Revenue – 76% Residential Segment | 20% Commercial Segment | 4% Retail Segment

Customer Segment

Dlf targets the following customer segment on its diverse real estate properties:

• High Network Individuals/Households: DLF has a wide range of luxury residential properties in gated communities that cater to wealthy clients. E.g. Projects like ‘The Camellias’ and ‘Arbour’
• Middle-Class Buyers: DLF offers affordable housing for the vast middle-class segment, with premium amenities at a reasonable price, located mostly in urban hubs. E.g. Projects like ‘DLF Valley Panchkula’ 
• Commercial and Corporate Clients : DLF’s commercial division caters to companies and institutions in need of office spaces, IT parks, and retail properties such as shopping malls.

Cost Structure:

Fixed Cost:

Particulars	Amount (in Rs. lakhs)
Employee Benefit Expense	35,137.77
Finance Cost	28,554.47
Income Tax Expenses	27,582.25

Variable Cost:

Cost of land, plots, development rights, constructed Properties and others	127,540.18
Brokerage, advertisement & sales promotion	11,538.86
Legal & Professional fees	14,010.31

What are the most important costs inherent in DLF’s business model?

• Land Acquisition and Development: DLF invests heavily in acquiring prime land with land purchases reaching significant values, such as the Rs. 200 billion land acquisition​ in Gurgaon.
• Construction and Development cost: Construction materials and development costs amounted to Rs. 27.9 billion in FY24, representing 80% of material expenses​.
• Employee and Labor Costs: Employee costs remained at Rs. 35,137.77 lakhs​, reflecting DLF’s dependence on skilled labor for execution.

Value Propositions: 

1. Pioneering Development: Creating iconic, world-class projects.
2. Green Leadership: Committed to sustainable and eco-friendly practices.
3. Trusted Brand: A reliable and transparent real estate leader.
4. Luxury Living: Offering premium residences with world-class amenities.
5. Prime Business Hubs: Developing futuristic office spaces for top MNCs.
6. Customer-Centric Approach: Tailoring projects to meet specific needs.
7. Enhanced Experiences: Providing diverse lifestyle and business options.
8. Superior Service: Delivering efficient and customer-focused services.
9. Uncompromising Quality: Ensuring the highest standards in every project.

Key Resources: 

Tangible Assets:

• Land Banks: Extensive prime land holdings in strategic locations.  
• Real Estate Properties: A diverse portfolio of residential, commercial, and retail properties.  
• Infrastructure: Developed infrastructure within its projects, including roads, utilities, and green spaces.

Intangible Assets:

• Brand Reputation: A strong brand reputation for quality, trust, and innovation.  
• Intellectual Property: Patents, trademarks, and copyrights related to its projects and designs.
• Customer Relationships: A loyal customer base and strong relationships with tenants and buyers.
• Human Capital: A skilled workforce, including architects, engineers, and marketing professionals.  
• Financial Resources: Strong financial position and access to capital markets.
• Government Relationships: Positive relationships with government agencies for smooth project approvals and clearances.
• Partnerships: Strategic partnerships with contractors, consultants, and other stakeholders.

Key Activities:

• Land Acquisition and Development: Strategically procuring and transforming land into high-value real estate assets.
• Innovation and Design: Pioneering cutting-edge architectural designs to enhance functionality and aesthetic appeal.
• Leasing for Commercial Activities: Facilitating premium leasing solutions tailored to office spaces and retail establishments.
• Office and Retail Rentals: Driving consistent revenue streams through the rental of commercial properties.
• Construction: Delivering world-class infrastructure with a commitment to quality and excellence.
• Property Updates and News: Disseminating real-time insights and updates on property markets and trends.
• Legal and Regulatory Compliance: Upholding rigorous adherence to statutory and legal frameworks in real estate.
• Financial Management: Optimizing fiscal strategies to sustain profitability and long-term growth.

Customer Relations:

• Digital self-service- Offer online tools and resources for easy access to information and support
• Community Engagement Events- Events like property showcasing and social gatherings to foster a sense of community among residents and enhance brand loyalty
• Curated experience for luxury buyers- Partnering with high-end brands and creating exclusive events for buyers
• After-sales property management- Managing the upkeep of properties with dedicated teams handling cleaning, repairs and security
• Exclusive customer loyalty programs- Reward loyal customers with exclusive offers and discounts and even priority access to new projects 

Channels:

• Real Estate Agents – DLF has a wide network of real estate agents to help in bringing prospective buyers and clients to various DLF’s residential and commercial properties.
• Official Website – DLF has a well-designed and constructive website, providing nuanced information about all of its projects, ventures, and properties in the residential, commercial, and retail segments.  
• Third-Party Management – DLF has signed contracts with third-party organizations such as Cushman & Wakefield and Jones Lang LaSalle to manage its properties, bringing about specialization and sustaining DLF’s core focus on Real Estate Development.  
• Experience Centers – DLF’s experience centers help potential clients experience what it is like to live in feature-rich properties with a lot of amenities and in utmost luxury. 
• Media Advertising – DLF has made itself well known in the Real Estate Industry by regularly advertising itself in newspapers and magazines and is also active on online platforms such as YouTube and X.

Source:
https://www.hdfcsec.com/hsl.docs/DLF%20-%20ARA%20-%20FY23%20-%20HSIE-202307260810490672012.pdf
https://www.dlf.in/annual_docket/Annual-report-2023-24.pdf
https://www.hdfcsec.com/hsl.docs/DLF%20-%20ARA%20-%20FY23%20-%20HSIE-202307260810490672012.pdf